Native Canadians demand stake in energy superpower play

Originally published March 29, 2014 at 8:00 pm

Updated March 29, 2014 at 10:01 pm

The Hardisty tank farm, which includes the TransCanada Hardisty Terminal 1, stands at dusk in Hardisty, Alberta, Canada. Canada is facing more challenges to resource-extraction projects from aboriginals than any other nation in the world.

Stephen Harper, Canada’s prime minister, hopes to boost the economy with C$650 billion worth of natural-resource projects over the next decade.

Back in the spring of 2012, while walking in the deep woods of northern Ontario, Sonny Gagnon stumbled across a collection of surveying equipment among the towering spruce trees. Gagnon is chief of the Aroland aboriginal tribe, a band of 450 people living in a village of ramshackle houses surrounded by swampy muskeg. He tracks everything that goes on in his community. And the surveying tools weren’t supposed to be there.

“I was ticked off,” he says, after learning that the equipment belonged to a subcontractor of Cliffs Natural Resources.

It turned out Cliffs had plans to mine for chromite to the north of the Aroland reserve and to build a road through the territory to transport truckloads of the mineral to a railhead.

“They weren’t consulting us on what they were doing on the land,” Gagnon says. “I told them to leave and that we didn’t want them back.”

Gagnon and his native band then set up a roadblock to monitor traffic. Cliffs suspended plans for the mine in November, citing in a statement the “risks” associated with its ability to transport the ore for processing.

Cliffs officials didn’t respond to requests for comment.

Aboriginal Canadians from Quebec to British Columbia are asserting their rights. Energized by a 2004 Supreme Court decision that requires governments to “consult and accommodate” aboriginal groups before miners and oil and gas drillers encroach on their lands, the natives have blocked half a dozen major projects since the court ruling.

That includes a proposed C$6.5 billion ($6 billion) oil pipeline from Alberta to the Pacific Ocean and a shale-gas project in the eastern province of New Brunswick.

The natives’ activism complicates Prime Minister Stephen Harper’s grand plan to boost the Canadian economy with C$650 billion worth of natural-resource projects over the next decade in a quest to make the nation an “energy superpower.”

Among the government’s priorities are mining projects in the so-called Ring of Fire region of northern Ontario, stepped-up oil extraction from Alberta’s tar sands and natural-gas exploration in British Columbia.

“These are huge issues, which have enormous implications for the economy of the country,” says Bob Rae, a former Ontario premier who once led Canada’s federal Liberal Party. “They’re right at the center of Canada’s economic life.”

The natives have a powerful political ally in Rae, who has agreed to negotiate with mining companies and the provincial and federal governments on behalf of the nine chiefs of the Matawa First Nations, including Gagnon.

The council holds sway over northern Ontario lands where major mineral discoveries were made as recently as 2008.

The aboriginals’ latest show of power came in New Brunswick in October and November, when demonstrators gathered in opposition to Houston-based Southwestern Energy’s plans to drill for natural gas on native lands.

The protesters clashed violently with police, at one point throwing Molotov cocktails that incinerated six police vehicles.

The company says the disruption cost it $60,000 a day. It got a court injunction that stopped the protests and proceeded with exploratory drilling in December.

Canada is facing more challenges to resource-extraction projects from aboriginals than any other nation in the world, according to an October report by Fredericksburg, Va.-based First Peoples Worldwide, which provides grants and services to native tribes.

The activists are divided into two groups. The so-called traditionalists want to shut out development and preserve native lands for hunting and fishing. “Progressives” want to share in the enormous wealth being produced by the country’s resource companies.

Often both points of view are represented in the same native band, creating conflict. Both can be found in a national movement called Idle No More, which has staged protests, including blocking train traffic between Montreal and Toronto in January 2013, demanding jobs, education and economic development for Canada’s indigenous communities.

Canada is home to 1.4 million natives, who make up 4.3 percent of the population, compared with 2 percent in the United States, according to the most-current census data.

More than half of Canada’s First Nations peoples, as they are known, live and work in cities; the rest are scattered across six time zones on more than 600 reserves.

Unemployment is as high as 90 percent in native communities such as Aroland, and the median per capita income was C$14,000 in 2005, the latest year for which figures are available. The per capita income of all Canadians today is C$40,650, according to Statistics Canada.

Canadian resource companies say they’re eager to accommodate the First Nations — so long as they don’t make unreasonable demands.

In August, Calgary-based Athabasca Oil won approval from Alberta’s energy regulator to start up an oil sands project in northeastern Alberta over the protests of the Fort McKay First Nation, whose traditional hunting grounds are adjacent to the proposed site.

The Fort McKay group wants a 12-mile buffer around the bitumen-drilling operation. Athabasca initially rejected the idea, but in December Chief Executive Sveinung Svarte said, “It is our view that a mutually acceptable solution is achievable.”

On the Pacific Coast, Calgary-based pipeline builder Enbridge has reached an angry impasse with the natives.

The company wants to lay a 732-mile line called Northern Gateway to connect Alberta’s oil sands with the Pacific port of Kitimat, where the oil would be loaded onto tankers and shipped to petroleum-thirsty Asian markets.

The pipeline would traverse British Columbia’s mountains and salmon streams.

It is opposed by native groups along much of its proposed route because they say oil spills and leaks would destroy their hunting and fishing grounds.

The Yinka Dene Alliance, a group of six tribes whose lands span the pipeline’s proposed route to the sea, have banned any Northern Gateway contractors from setting foot on their lands.

The Coastal First Nations, an alliance of nine aboriginal groups on the British Columbia seashore, is equally determined to block Enbridge’s pipeline, and joined dozens of First Nations that voiced their opposition to the pipeline during 2012 regulatory hearings by Canada’s National Energy Board.

Prime Minister Harper, who also faces opposition to the pipeline from nonnative British Columbians, has until June to decide the project’s fate.

Their recent victories in holding up projects have emboldened the aboriginals.

With the stakes in the tens of billions of dollars for Harper’s government and the resource companies he supports, Gagnon and other native Canadians have never been in a better position to right some of the historic wrongs they believe their people have suffered.